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China’s gloomy economic outlook has taken the fizz out of consumer spending, PwC says
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Chinese consumers are adjusting their spending habits to account for the country’s less-than optimistic economic outlook, according to global advisory firm PwC.
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The crisis in China’s real estate sector and high youth unemployment are among concerns weighing on consumer spending, it said in a report published on Tuesday.
“Although the degree of financial concern felt by Chinese consumers is less acute than global counterparts, consumers have been holding back on non-essential spending,” said Michael Cheng, PwC Asia-Pacific consumer markets leader.
“The recent weakness of the yuan together with poor real estate and equity performance, coupled with a record-high youth unemployment rate, has dampened consumer spending. Consumers feel the pinch of financial uncertainty, which has further undermined consumer confidence and heightened risk of deflation.”
The PwC report is significant because Beijing has been trying to encourage domestic consumption as a way of driving and growing its economy.
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